At the request of Senator David Leyonhjelm; StarCore Nuclear Submission to the Select Committee on Wind Turbines

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1 June 23, 2015 Select Committee on Wind Turbines PO Box 6100 Parliament House Canberra ACT 2600 Dear Sir/Madam, At the request of Senator David Leyonhjelm; StarCore Nuclear Submission to the Select Committee on Wind Turbines Summary This submission shows how the Renewable Energy Target (RET) wind power requirement could be complemented by nuclear power to help achieve the desired carbon emission reductions with additional benefits, particularly economically. While wind farms could positively impact specific locations on-grid, there exist many remote locations where wind would not be the solution of choice. By utilising Small Modular Reactors (SMRs) to fill the remote energy requirement, and later utilising larger reactors for base load needs on-grid, a higher rate of carbon emission reduction can be achieved at a lower levelised cost of energy (LCOE). Remote locations and mini grids are particularly important in this instance because: a) it is an area outside of where renewables are effective today, b) most of Australia s mineral resources and associated processing facilities are located remotely, and c) they contribute to a significant proportion of Australia s carbon emissions. SMRs could contribute by not only by addressing the power needs of these areas but also by: Providing power at as low as 18 cents per kwh (which will continue to decrease in the future) and down to 20 MW in size. This can be provided with no capital investment, by using a Power Purchase Agreement, and requires no subsidies. Extremely small footprints, disturbing much less land than required by solar or wind. Safety, not only in physical attributes, but also historically over other forms of power a. Using excess heat to desalinate water or to distribute to communities/industrial processes. Providing internet connectivity, key to remote education and health support. By diversifying Australia s energy mix with nuclear as well, a greater audience can be reached to better effects. Wind power will also receive the benefit of added agility by a Appendix Table 1

2 relieving time pressures and being sure only the most cost-effective solutions are developed. Wind and nuclear could be strong forces in changing the energy supply structure, if used strategically together. Responses The application of regulatory governance and economic impact of wind turbines, with particular reference to: a. the effect on household power prices, particularly households which receive no benefit from rooftop solar panels, and the merits of consumer subsidies for operators; In any case where subsidies are used, household power prices would rise. While wind power has made drastic improvements in the last decade, it has still not reached the point of being able to economically replace large amounts of base load power, on- or off-grid. Ideally, any power source that has an opportunity to be subsidised should already be competitively priced and be able to operate profitably without subsidies. At the scale suggested for wind power, it should also be able to provide base load power, which most of the carbon emitting sources service. Ideally, any form of government support should only affect farms that operate at the profitable end of the spectrum shown in Appendix Tables 2a and 2b, as competitive operators already service the variable load on Australian grids. As wind power operates at a low capacity factor compared to most other sources, this would at least ensure positive selection by developers. In consideration of the already strained Australian Government Budget, energy subsidies have historically had negative impacts. Spain implemented heavy solar subsidies in 2004, which did yield high growth in solar farms across the country. Many of these solar farms were funded with pension fund investments because they were seen as stable, long-term investments of high grade. In the wake of the GFC, Spain ended these subsidies and later retroactively rescinded subsidies that the government could not afford to pay. Because most of the solar farms profit points were financially founded upon the subsidies, many people lost their investments completely. This was widely perceived as a lesson in the wrong way to redistribute renewable energy within the framework of a national power system. Should Australia implement subsidies for operators, it should be done with Spain s example in mind and with the knowledge that subsidies often cause market distortions with negative effects. While the intent of the RET is to transform our electricity generation mix to cleaner and more diverse sources and supporting growth and employment in the renewable energy sector b, it can also be assumed that economical application of these funds is equally important. Nuclear power is a source that not only meets all of these qualifiers, but far excels in comparison to most current renewable power sources in the areas of cost and biodiversity conservation, as shown in Professors Bradshaw and Brooks paper Key Role b See The Renewable Energy Target scheme website, retrieved 15/6/15.

3 for Nuclear Energy in Global Biodiversity Conservation c. Rather than unbalancing the energy market with targeted subsidies, it makes more sense to instead explore opportunities in a source that is already cost competitive with fossil fuels, requires no subsidies and can give renewables time to advance while still reducing carbon emissions. b. how effective the Clean Energy Regulator is in performing its legislative responsibilities and whether there is a need to broaden those responsibilities; From the Clean Energy Regulator website: The role of the Clean Energy Regulator is determined by climate change law. The schemes we administer work together to reduce emissions while encouraging business competitiveness. In order for the Clean Energy Regulator (CER) to be as effective as possible at reducing carbon emissions and encouraging business competitiveness, climate change law needs to allow all logical forms of carbon neutral power to be explored. This would imply that changing the EPBCA to allow nuclear as a possible power source would be in the interest of aiding the CER to achieve their goals in carbon emission reduction. c. the role and capacity of the National Health and Medical Research Council in providing guidance to state and territory authorities; It should be stated that while this submission points out the ways that nuclear power could complement wind power to assist with carbon emission reduction and make the switch more cost effective while wind technology progresses, it certainly takes into account health and safety concerns that have historically been associated with nuclear power. For those acquainted with nuclear installations since 1996, there is no question that nuclear technologies today are of no danger to the populace or the environment. As shown in Professor Bradshaw and Brooks paper c, today s nuclear has an even better safety record than that of wind power. Some sensationalism surrounds past nuclear events, but even facilities such as Fukushima would be akin to comparing the Hindenburg to today s Goodyear Blimp, especially when it comes to safety and security. Any nuclear facilities considered by Australia would be at least Generation III, most likely Generation III+, and particularly in the case of SMRs. What this means is an extremely high level of safety, even to the extent of withstanding terrorists crashing aircraft into the facility. StarCore s SMR is the only commercially available Generation IV SMR that we know of. Generation IV implies that the reactor is inherently safe, meaning the reactor is physically incapable of going into meltdown. There is no radiation loss, the reactor does not affect ground water, and there is no clean up or wait period required if the reactor is eventually removed. d. the implementation of planning processes in relation to wind farms, including the level of information available to prospective wind farm hosts; No Response c Key Role for Nuclear Energy in Global Biodiversity Conservation. Professors Barry Brook and Corey Bradshaw. University of Adelaide, Adelaide, SA Retrievable from:

4 e. the adequacy of monitoring and compliance governance of wind farms; No Response f. the application and integrity of national wind farm guidelines; No Response g. the effect that wind towers have on fauna and aerial operations around turbines, including firefighting and crop management; Generally accepted wind power fauna effects include: avian deaths, altered avian life patterns, and visual pollution. However, in terms of land use for each source, wind power requires over 2 orders of magnitude more land than nuclear power d. When placing noncarbon emitting power sources shoulder-to-shoulder, nuclear is definitively less visually and geographically disruptive. Most Small Modular Reactors (SMRs) today not only have extremely small footprints, but also have low-profile building designs. The StarCore reactor design is only 2 stories tall, 100m long and 30m wide. Visually, the site has no fences and does not require landscaping the surrounding area. h. the energy and emission input and output equations from whole-of-life operation of wind turbines; Carbon inputs to wind turbines and nuclear power are roughly similar and neither are operational carbon emitters d. However, given the major advantages that nuclear power has over wind power in almost every other category, the comparison is currently very onesided. i. any related matter. Australia is a large, sparsely populated country, and there are a large proportion of consumers who live off-grid, on a mini-grid, or at the extremes of the main grid. These consumers often face extreme energy costs and also utilise carbon-emitting sources because of their low initial capital cost. This market is a prime opportunity to reduce emissions while increasing economic competition at the same time. A large part of Australia s commodity wealth exists in this realm. As shown in Appendix Table 3, other sources often operate at 30 cents per kwh and above, due to storage costs (in the case of renewables) or fuel costs (in the case of fossil fuels). We have found that Small Modular Reactors (SMRs) can service these sites at a cost of ~18 cents per kwh. In the specific instance of a StarCore reactor, this comes with no initial investment, provides desalination opportunities and Internet connectivity, among other benefits. These reactors can service mini grids as small as 20MW in size. While wind power will certainly find a place servicing variable load requirements on-grid and perhaps a few choice opportunities in remote locations, we would recommend allocating a portion of the RET requirement to exploring off-grid opportunities for nuclear. d Appendix Table 1

5 There is a major dent to be made to carbon emissions by the CER in circumstances where remote consumers have felt that they had little choice in their options for power supply in the past. Wind and other renewable sources do not have the technology yet to compete in these areas, but nuclear can give them the time they need to catch up while eliminating carbon emissions in those locations. Nuclear certainly has a place supplanting carbon emissions from base load sources on-grid as well. However, any country would be smart to utilise a soft start when entering into an advanced technology; both to ease public concerns and to ensure the technology is applied effectively. By initiating with remote locations; directly affected groups are smaller, less capital is required to affect better-controlled test cases, and the positive economic and environmental effects over time can be proven at highly detailed levels. This would warm the seat at the table for the eventual inclusion of nuclear on-grid to replace ageing coal and natural gas facilities and create large block reductions in carbon emissions. Should you have any questions or comments, please contact me. Your Sincerely, AD Dabney Business Analyst StarCore Nuclear (Australia)

6 Appendix Table 1. Power Source Comparison Of Economic- Environmental Impact Source: Key Role for Nuclear Energy in Global Biodiversity Conservation. Professors Barry Brook and Corey Bradshaw. University of Adelaide, Adelaide, SA Retrievable from:

7 Appendix Table 2a. On-Grid Power Costs for Several Sources Appendix Table 2b. On-Grid Power Costs for Several Sources including Applicable Carbon Capture Storage Costs Source: Professor Dongke Zhang. UWA Centre for Energy, University of Western Australia, WA

8 Appendix Table 3 Source: Technical and Economic Assessment of Off-Grid, Mini-Grid, and Grid Electrification Technologies. The World Bank Group, Energy Unit, Energy, Transport and Water Unit. September 2006.